Consumer Alert: Beat the System

Beat the System is a network marketing program put together by a company that calls itself Fidelity Alliance Marketing Group, which does not appear to be associated with any other product or service. The product offered by the Beat the System program is a series of discount benefits, such as grocery coupons and car purchase programs.

The real lure, as with most multi-level marketing programs, is the business opportunity represented by finding other people who are also interested in the business opportunity rather than the product that the business opportunity offers.

Based on sales closing ratios that are described as "conservative", Beat the System includes earnings projections ranging from $12,500 to $86,000. Testimonials from participants claim to be wealthier by $35,225 and $58,000 (of which $25,000 constitutes savings from the program). You will need to decide whether or not purchasing their savings programs will actually make you $25,000 wealthier!

The cost to obtain membership benefits is $1,250. What do you get for this money?

Consider the following when evaluating these benefits:
  • Grocery coupon programs, car purchase programs, and 2-for-1 hotel programs are available elsewhere, separately or combined with other benefits, for something under $50 each.
  • Mortgage acceleration programs usually provide for 13 months worth of payments to be paid each year, on a bi-weekly basis. The savings accomplished through such a program can be accomplished directly, without paying any additional fees.
  • Airline discount coupons are frequently offered as incentives with credit cards, other travel discount programs (typically available for under $50), and from time to time, with consumer purchases of specific brands of products such as soap and toothpaste. Most of the time, these coupons carry significant restrictions on the fares to which they apply. Thus, to use a coupon that promises you a $100 discount, you might have to use a fare that cost $200 more than the best fare you could otherwise use.

    Business viability

    Any viable multi-level marketing program must have a product or service that can stand on its own merits, without the lure of the business opportunity. This is primarily a subjective criteria that, if not met, will not, on its own, normally subject the program to prosecution. However, any program that fails to meet this criteria is tantamount to a pyramid scheme.

    Legality

    In the United States, the Federal Trade Commission has rules pertaining to unfair and deceptive business practices. These rules do not specifically address multi-level marketing programs; however, the FTC does have regulations regarding the representation of earnings claims which are potentially violated by Beat the System.

    In addition to the FTC, various states have laws against pyramid schemes. (Click here to read the law in one state.) While these laws differ in significant ways, they may limit the amount that can be required to participate in the business opportunity to the cost of required materials, such as disclosure and enrollment forms. Many states also prohibit any requirement to purchase the product or service offered in order to participate in the business opportunity.

    If you are a participant in a scheme that is illegal in your state, you could potentially be named as a defendant in a criminal action. Do not rely on claims that the program is legal in your state... check your states' statutes or your states' Attorney Generals office for the applicability of such laws.

    Contact Information

    The following contact information for "Beat the System" is provided for identifcation purposes only:

    Fidelity Alliance Marketing Group, L.L.C.
    1372 Broadway
    New York, NY 10018
    phone: 1-800-380-2642

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